Welcome back to the channel everyone today, i want to talk about how citadel could be forced to cover their short positions next week, and this could be caused by a mix of investor withdrawals and existing and new losses. So stay tuned and let's make some money, and now i want to dive straight in with the key information. So, firstly, you may notice this video is a little shorter than usual. I've actually just tested positive for covid and i feel, like i've been hit by a bus but i'll try my best to edit out any coughs and splatters.

So mother of all short squeezed trigger alert citadel investors have, until november 15th to withdraw funds from citadel. If enough investors get spooked and withdraw the mother of all short squeezes will be triggered. Now. Obviously, over the last month, citadel has received a lot of bad press on social media, and it was also covered by mainstream media as well.

That would have caused tons and tons of investors to withdraw cash from citadel and potentially also line up future withdrawals by this november 15th deadline. But so why exactly is that going to make citadel cover their short positions? How do the two link together? Well, as this article says, it's the last call for investors to ask for their money back from poorly performing hedge funds. Whether this is a bullish or bearish sign for battered stocks is anyone's guess. Wall street hopes the passing of the november 15th deadline.

The last day for many investors to make a request to redeem hedge fund shares payable at year's end, could mark the beginning of the end of force selling by funds to raise cash. Obviously, if citadel has to raise tons and tons of cash, they are going to have to sell off their long positions and they are going to have to cover their short positions in order to close out of trades to get the cash to give back to investors. Now, on top of this, also don't forget that citadel use around eight times, leverage so say an investor wants to withdraw a billion dollars citadel actually have to sell off eight billion dollars worth of stocks, because they'd obviously have to repay the seven times or eight times. Leverage in terms of margin, loans and return, the original billion dollars, so if investors want to withdraw 10 billion dollars from citadel welps today, would need to sell off 80 billion dollars worth of stocks to obviously repay those margin, loans and return.

The original 10 billion. If the selling recedes it could help lift some of the downward pressure on stocks for selling has been blamed for sharp stock price swings and plunging asset values in the financial crisis. Now, yes, that's for selling of long positions like citadel's long position on tesla, but this would also be forced covering of their short positions like their short position on amc and, obviously, a forced covering on an amc short position could cause a sharp stock price swing upwards. For amc, investors have redeemed an estimated 85 billion dollars from hedge funds through the end of the third quarter, but some analysts fear the deadline could spark more selling if hedge funds realize they've not yet raised enough money to meet all of the requests.

Don't forget that during that third quarter, the s p 500 actually took a fairly sizable dip and therefore a lot of hedge funds are going to be operating on negative returns for the year. If hedge fund is operating on negative returns or just poor returns. Well, investors are likely to withdraw money. A research firm said: it's been an abysmal year for hedge funds, secretive and likely regulated investment partnerships that are marketed as being able to post positive returns in both up and down markets.

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You could get just for signing up with moomoo and making your first deposit linked in the description below, but what else could be problematic for citadel? Well, this poster found a 1.5 billion dollar call position in citadel's 13f for disney call options now, obviously disney had their earnings and was down 7 on the day and the company lost over 20 billion dollars in value and therefore citadel would have lost at least 7 Of 1.5 billion dollars on disney alone, but also remember that citadel holds cool options on disney and not the underlying stock. So, depending on whether they hold weekly, monthly, quarterly or yearly call options, they could be down much more than just seven percent. For example, the weekly disney call options were down between 99 and 66, so therefore still could potentially be down 99 of their 1.5 billion dollars. That would obviously be a giant giant loss, and when you combine that with investor withdrawals, you could see that citadel could be having to sell off a lot of their long positions and cover a lot of their short positions as well.

Now, on top of this, as antonio suggested, gamestop and amc short, sellers have lost more than 10 billion dollars as the year ends. Short sellers, betting against gamestop and amc ended the month of october by rapidly extending their losses. Despite making some rapid recoveries earlier in the year, gamestop and amc were pushed to the limelight earlier this year, when retail traders, united on the social media platform, reddit and collectively purchased the company's shares in order to boost the prices back in october, data from s3 partners Revealed that gamestop and amc short sellers had started to recover their losses at a rate of 20 million dollars per day, the short sellers, whose losses had stood at 6.21 billion dollars for gamestop and 3.49 billion dollars for amc respectively by midday on october. 1St saw them drop to 6.16 billion and 3.44 billion in just five trading days, but that was short-lived because by the 26th of october, the short seller's losses on gamestop had extended by an additional 20 million dollars and the short sellers losses on amc had extended by Another 70 million dollars, but by november 4th those losses had extended to 6.51 billion dollars for gamestop and 3.69 billion dollars for amc, so over 10 billion dollars in total and we've also got another hedge fund.

That's closing its doors, just in famous permabull russell clark is shutting his hedge fund. He lost 2.6 through october this year and was down to about 200 million dollars in assets from about 1.7 billion dollars in 2015., and this just shows that the current market is not good for short sellers and, at the end of the day, short sellers should not Be trying to short and destroy companies like amc and gamestop, and also i wanted to show you this video that talks about the fed not having any idea what they're currently doing. You know i just don't know what the fed's doing or why it's doing it stuart they're way out of control. You know the way they historically have controlled.

Inflation is by having required reserves and the monetary base and then reducing the monetary base, so that banks would be required to withdraw and reduce the amount of demand, deposits and money supply. But there is no longer any connection whatsoever between the monetary base and required reserve. So there's no control the fed has over money, except that it's buying all the government bonds that are being issued, all the deficit and there and - and they are doing just like you said - explain expanding member banks deposits at the fed and it's crazy. I don't know what they think they can do.

Um. I see big trouble coming. Do you me too? Yes, i see it's really big trouble. They have no control over money, supply or anything else anymore, and what they do is basically irrelevant, except they keep those rates low by printing, more and more and more and more member bank deposits.

What what they do steward is they buy the government debt and then they buy it with member bank deposits held at the fed, which just monetizes all the debt that they've got. So this goes to show just how much of a tough time that fed are having with new 30-year high inflation rates. As i went over my video the other day, the october inflation data showed an inflation rate of 6.2 percent, which is a 30-year high, not seen since the 1980s. This is higher inflation than we saw back in 2008 back in 2000.

Back in the 90s, we haven't seen anything this high since the 80s. Peter han also made a comment as to why this high inflation and a market crash could positively impact amc. Peter said, in short, higher inflation forces the fed to stop printing money ease liquidity dries up. Banks have to reduce margin, loans to short hedge funds.

Short hedge funds then have to start reducing leverage by covering their short positions and selling off some of their long positions, and then obviously the mother of all short squeezes will start. The fed is trying to stall that, but they may not be able to. If december inflation is even worse, basically, when the fed stops printing money, the banks will stop lending money quite as easily meaning. These hedge funds will have to reduce their margin levels to be able to meet those margin, requirements to reduce margin levels.

They will have to sell off long positions and they will have to cover short positions like covering their amc positions, but obviously also when these hedge funds sell off these long positions. It's gon na cause small little crashes in various little stocks, which is going to reduce their margin and account size even more it'll end up just being a spiral of selling off stocks to meet their margin requirements. The value of those stocks will fall and they'll then have to sell off more stocks to continue to meet those margin. Requirements guys be sure to.

Let me know down in the comments below what you think about citadel, potentially having to cover their shorts next week. Due to investor withdrawals and big losses, and if you haven't already be sure to sign up to moomoo to get those five free stocks valued up to three thousand five hundred dollars each and as always guys. If you enjoyed this video be sure to check out some others, alternatively, subscribe to the channel and in that notification bell, because that way, you'll be alerted. When i upload a new video cheers.